Oman’s Steel industry seeks punitive duties on cheap imports

Beleaguered industry: Discounted foreign steel floods local market

Conrad Prabhu –
MUSCAT –

Dec 30: Oman’s top steelmaker Jindal Shadeed Iron & Steel (JSIS) has sought the intervention of authorities in safeguarding the interests of the nation’s fledgling iron and steel industry as it deals with a tide of “cheap” steel imports flooding the domestic market.
Naushad A Ansari (pictured), Director and Head of the Sohar-based plant, appealed for countermeasures, notably anti-dumping duties, to be imposed on foreign mills behind the current glut of discounted steel in the local market.
The oversupply of foreign cut-rate steel, compounded by the global slump in commodity prices, has already begun to negatively impact the company’s operations, he warned.
“Of course, the economic downturn has had an impact on the performance of JSIS,” Ansari said. “We are now operating at half the capacity due to the slump in prices (triggered by) cheap imports mainly from China, Iran, the CIS, and so on,” the Director stated in exclusive comments to the Observer.
A wholly owned subsidiary of Indian conglomerate Jindal Steel and Power Ltd (JSPS), Jindal Shadeed operates the Sultanate’s largest integrated steel complex at Sohar Industrial Port. The sprawling facility comprises a 1.5 million tonnes per annum (TPA) Direct Reduced Iron (DRI) plant in addition to a 2-million TPA steel melt shop (SMS), which came into operation in July 2014. The company is also preparing to shortly commission a state-of-the-art 1.4 million TPA rebar mill.
Significantly, cheap steel supplies have menaced the steel industry globally, according to Ansari. “It is a fact that cheap steel imports have been creating an unhealthy situation for the steel industry worldwide. The dumping of steel from China, CIS, Iran, Turkey, and so on, at prices much lower than the cost of steel, is pushing the world steel market into a very critical situation. There have been unprecedented imports from these countries into the GCC. Local steel units have been under pressure and are forced to either close down or reduce their output.”
Citing the examples of a number of countries that have levied punitive duties on unfairly priced steel, the Director urged Oman’s authorities to weigh similar action against those indulging in predatory pricing. “Many countries (and blocs), such as the United States, European Union, Canada and India, have already imposed antidumping duties on cheap imports (in their respective jurisdictions). We have also been (arguing for the) imposition of safeguard duty / antidumping duty on these cheap imports,” he noted.
To help mitigate the impact of these factors on its performance, Jindal Shadeed has adopted various cost control measures designed “to keep the cost of production as low as possible and be competitive in the present-day situation,” the official said.
“Jindal Shadeed’s adoption of an innovative iron-to-steel conversion process called Direct Hot Charging — wherein Hot Direct Reduced Iron (HDRI) around at 600 degrees centigrade temperature is charged directly into the Electric Arc Furnace of the Steel Melt Shop (SMS) by gravity — lowers the energy requirements and increases efficiency. Other methodologies experience substantial temperature losses that the combination of hot charging and direct linkage enable us to avoid. This gives us a competitive advantage over other players,” Ansari added.